Which of the Following Is not True Regarding Proprietary Funds

question 124

Multiple Choice

Which of the following is not true regarding proprietary funds?

• A) Accrual accounting and the economic resource measurement focus are used.
• B) Statements required are the Balance Sheet, the Statement of Revenues, Expenditures, and Changes in Fund Balances, and the Statement of Cash Flows.
• C) Long Term debt is recorded directly in the accounts.
• D) Proprietary funds financial reports include the Statement of Net Position, Statement of Revenues, Expenses, and Changes in Fund Net Position, and Statement of Cash Flows.

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Definitions:

Consolidation Purposes

The objective of amalgamating financial statements from various entities within a single corporate group to present a unified financial position and results of operations.

Eliminate Unrecognized

A process in accounting, often related to consolidation, where unrealized profits, losses, or transactions within or among entities are removed from financial statements.

Intra-entity Gross Profit

The profit recognized on transactions conducted within the same entity, which may need to be eliminated in consolidated reporting.

Intra-entity Gross Profit

The profit recognized from transactions within the same company, affecting consolidated financial statements.